FATCA Form 8938 for Canadians who become US persons in Florida

Section 01Section 1. Why this topic exists in your life as a Canadian in Florida

A snowbird who comes to Florida five months a year and remains a resident of Quebec, Ontario, British Columbia, or any other province does not file Form 8938. The form is a US-person obligation, and snowbirds who properly maintain their Closer Connection on Form 8840, who do not meet the Substantial Presence Test, or who are protected by the Canada-US treaty tie-breaker, do not become US persons. They have no 8938 exposure.

The form becomes relevant the moment the Florida stay turns into something more than a winter season. Three transitions activate FATCA reporting:

The first is the green card. The day the United States Citizenship and Immigration Services issues you a permanent resident card, you are a US person for income-tax purposes for the entire calendar year, even if you only landed in November. Form 8938 attaches to your first 1040 (or dual-status 1040 in the year of arrival) the moment your specified foreign financial assets cross the threshold.

The second is the Substantial Presence Test. A Canadian who fails to file Form 8840 in time, or whose US presence pattern over three years exceeds the 183-day weighted formula and who cannot claim a closer connection, is deemed a US resident for the entire year. Form 8938 follows.

The third is a treaty tie-breaker that goes the wrong way. A Canadian who relocates to Florida on an E-2 investor visa, EB-5 investor green card, or any other long-stay status, who has substantial US ties, may lose the Canadian residency tie-breaker analysis and be classified as a US tax resident under Article IV of the Canada-US treaty. Same result: Form 8938 applies.

For a Canadian snowbird who reads this and concludes "I am not a US person, I do not need to file," the practical importance is to verify and document that conclusion every year on Form 8840. For a Canadian who is making a permanent move, an investor visa application, or who is on a green card path, the practical importance is to start tracking Canadian financial accounts immediately. The value of the Canadian RRSP, TFSA, brokerage, and chequing accounts on December 31 of the year you become a US person determines whether 8938 is required, and the documentation you accumulate that year is what your US tax preparer needs to file accurately.

Section 02Section 2. Who is a US person, who is not, and how the boundary works

The IRS uses three categories for individuals: US citizen, lawful permanent resident (green card holder), and tax resident under the Substantial Presence Test. A US person is anyone in any of those three.

A Canadian citizen who is not also a US citizen, who has never held a green card, and who has never met the Substantial Presence Test, is not a US person. Form 8938 does not apply. The Canadian remains under Canadian tax rules only.

A Canadian who acquires a green card, even if they never physically move to the United States, becomes a US person from the day of issuance. The green card creates worldwide US income tax filing obligations, including all the FATCA reporting forms.

A Canadian who spends the following days in the United States meets the Substantial Presence Test:

• Days in the current year, plus
• One-third of days in the prior year, plus
• One-sixth of days in the year before that.

If the weighted total reaches 183 and current-year days alone reach at least 31, the test is met. A Canadian who spends 122 days in Florida every year for three consecutive years (122 + 122/3 + 122/6 = 122 + 40.67 + 20.33 = 183 exactly) meets the test annually unless one of two escape mechanisms applies: Form 8840 Closer Connection (filed by June 15 of the following year, requires fewer than 183 current-year days and a closer connection to a foreign country), or the Canada-US treaty tie-breaker (Form 8833, requires meeting Article IV centre-of-vital-interests, habitual abode, or nationality tests).

A Canadian who fails to file Form 8840 in time for a year in which they met the SPT is technically a US person for that year. The IRS position is that filing Form 8840 late or missing it altogether terminates the closer-connection escape; the treaty tie-breaker remains available but requires substantive analysis. A Canadian in this situation should consult a cross-border tax attorney before filing or amending anything.

A US citizen by birth is a US person for life regardless of where they live or how rarely they visit the United States. A Canadian who is a dual citizen (born in the United States to Canadian parents, naturalized in the United States and then returned to Canada, or born in Canada to a US-citizen parent who passed citizenship by descent) is a US person for IRS purposes from birth. Form 8938 applies the moment the threshold is crossed in any year, even if the dual citizen has lived their entire life in Canada.

Section 03Section 3. The thresholds, mapped to four typical situations

The Form 8938 threshold depends on filing status and on whether the taxpayer lives inside or outside the United States. The IRS defines "living abroad" for this purpose as having a tax home in a foreign country and being physically present in a foreign country at least 330 days during a continuous 12-month period, or being a bona fide resident of a foreign country for an entire tax year.

The four reporting tiers in 2026 are unchanged from prior years:

A Canadian who moves permanently to Florida in March of a tax year, takes a green card, and accumulates more than USD 50,000 of aggregate Canadian financial assets at any time during the year crosses the single tax-home-in-US threshold and must file Form 8938. The "any time" trigger means that even if the Canadian repatriates the funds before December 31, the form still applies.

A married Canadian couple who both become US tax residents that same year, who file jointly, and whose combined Canadian financial assets exceed USD 100,000 at year end, file one joint Form 8938.

A snowbird who maintains Canadian residency under the treaty tie-breaker, lives in Florida five months a year, files no US return, owes no FATCA reporting. The 8938 obligation never attaches.

A green-card-holding Canadian who returns to live full-time in Quebec but has not formally surrendered the green card (Form I-407), still has US-person status. If their tax home is now in Canada, the abroad thresholds apply: USD 200,000 single / USD 400,000 joint at year end. The threshold is higher, but the obligation persists until the green card is surrendered or revoked.

Section 04Section 4. Specified foreign financial assets, item by item

The reportable category is wider than most Canadians expect. The IRS regulations at Treas. Reg. Section 1.6038D-3 list:

Foreign deposit accounts: Canadian chequing, savings, GICs, term deposits at a Canadian bank, credit union, caisse populaire, or foreign branch of a US bank. The maximum value during the year is reported, not just the year-end value.

Foreign custodial accounts: brokerage accounts held at a Canadian broker (Wealthsimple, Questrade, RBC Direct Investing, TD Direct Investing, BMO InvestorLine, NBDB, Disnat), regardless of whether the assets inside are US securities or Canadian.

Foreign pension and retirement accounts: RRSP, RRIF, LIRA, LIF, RPP, IPP, individual pension plans. The Canada-US treaty defers US income tax on RRSP/RRIF growth, but the asset is still reportable on 8938. The maximum value during the year is reported.

Foreign registered savings accounts treated as trusts: TFSA, RESP, FHSA, RDSP. The IRS treats these as foreign grantor trusts. Form 8938 reports the trust interest, but Form 3520 (annual transactions) and Form 3520-A (annual information return of the trust) are also separately required, with separate USD 10,000-per-form penalties. This is the single most common compliance trap for Canadians who become US persons.

Foreign-issued life insurance contracts with cash value: a participating whole-life policy from Canada Life, Manulife, Sun Life, Industrial Alliance, where the cash surrender value contributes to the aggregate.

Direct holdings in foreign corporations or partnerships (other than through a custodial account): shares of a private Canadian holding company (Holdco), shares of a private operating company (Opco), partnership interests. These also trigger Form 5471 (corporations) or Form 8865 (partnerships) reporting, beyond Form 8938.

Foreign-issued securities held outside a custodial account: bearer instruments, physical share certificates, debt obligations.

What is NOT reportable on Form 8938:

Accounts held at a US branch of any bank, even if the bank's parent is foreign. RBC Bank US (Raleigh, NC), BMO Harris (Chicago, IL), TD Bank US (Cherry Hill, NJ), CIBC US (Atlanta, GA) accounts are US accounts. They appear on the 1040 normally; they do not appear on 8938.

Real estate held directly. A Canadian holding a Florida condo in personal name does not report it on 8938. The asset is not financial. (If the same condo is held through a Canadian corporation, the corporation's shares are reportable.)

Personal-use assets: a Canadian car kept at the cottage, a Canadian piece of art.

Social Security or Canadian Old Age Security entitlements that have not yet been claimed.

Form 8938 reports the category, the maximum value during the year (translated into US dollars at the year-end exchange rate per the Treasury reporting rate), the institution name and address, and the account number. Joint accounts with a non-US-person spouse are reported at the full value (not half) on the US person's 8938.

Section 05Section 5. Form 8938 vs FBAR vs T1135: how they overlap and where they don't

This is where Canadians most often mis-file. Three forms touch overlapping but not identical perimeters.

Form 8938 (FATCA, IRS): US persons only. Threshold USD 50,000 / 100,000 / 200,000 / 400,000. Filed with Form 1040. Penalty USD 10,000 per failure, up to USD 50,000 continuing.

FBAR / FinCEN Form 114 (Bank Secrecy Act, FinCEN, not IRS): US persons only. Threshold USD 10,000 aggregate at any point during the year, much lower than 8938. Filed separately, electronically, by April 15 (automatic extension to October 15). Penalty up to USD 10,000 per non-willful violation, up to the greater of USD 100,000 or 50% of the account balance per willful violation. See our dedicated guide on FBAR for Canadians.

T1135 (Foreign Income Verification Statement, CRA, Canada): Canadian residents only (regardless of citizenship). Threshold CAD 100,000 cost amount of specified foreign property at any time during the year. Filed with the T1 return. A Canadian snowbird who owns a Florida condo (in personal name) above CAD 100,000 cost amount must file T1135; the same snowbird does not file Form 8938 because they are not a US person.

A Canadian who becomes a US tax resident through SPT for one year, then breaks residency the following year by spending fewer days, has Form 8938 plus FBAR for the US-resident year, then returns to T1135 only for the following Canadian-resident year.

A green-card-holding Canadian who returns to Canada physically but does not formally surrender the green card has both: Form 8938 plus FBAR (because they remain a US person), AND T1135 (because they are also Canadian-resident). The two regimes overlap completely for that person until the green card is surrendered.

A US-citizen Canadian who has lived in Quebec all their life, who has never set foot in the United States as an adult, who has aggregate Canadian financial assets exceeding USD 200,000 abroad-threshold, files Form 8938 and FBAR every year for life unless they renounce US citizenship under IRC Section 877A.

Section 06Section 6. Worked example: a Quebec accountant accepts a Naples job offer

A 38-year-old chartered accountant living in Brossard, Quebec, accepts a position with a Naples-based accounting firm starting March 15, 2026. She receives an L-1 intracompany transfer visa. Her Canadian financial picture on the day she lands in Florida:

• Personal chequing account at Desjardins: CAD 14,500
• Joint chequing with husband at National Bank: CAD 22,000 (her half: CAD 11,000, but the IRS counts the full amount on her 8938)
• TFSA at Wealthsimple: CAD 87,000
• RRSP at Desjardins: CAD 158,000
• LIRA at Industrial Alliance from a prior employer: CAD 41,000
• RESP for two children: CAD 38,000 (joint with husband; she reports her half if she is a co-subscriber, or the full amount if she is the sole subscriber)
• Brokerage at Disnat: CAD 67,000 (US securities held in this account; the account itself is the reportable item, not the underlying securities)

Conversion at year-end Treasury rate (assume USD/CAD 1.36 for 2026): aggregate equivalent USD 308,000.

Test: She passes the Substantial Presence Test for 2026 (more than 183 days in the United States from March 15 onward). She files a dual-status return: Form 1040-NR for January 1 to March 14, then Form 1040 for March 15 to December 31. Form 8938 attaches to the 1040 portion.

Her tax-home test: she has been in the United States for nine months, working full-time in Naples, with a US lease and a Florida driver's license. The IRS treats her as having a US tax home. The applicable threshold is single, tax home in US: USD 50,000 end of year or USD 75,000 any time. She crosses both, on every account category, by an order of magnitude.

She files Form 8938 listing all six accounts, plus the TFSA which also requires Form 3520 and Form 3520-A. The RESP follows the same trust treatment.

She files FBAR separately (FinCEN 114) because the same accounts cross the USD 10,000 aggregate threshold.

She does not file T1135 in Canada for 2026 because she is no longer a Canadian resident as of March 15 (assuming she severs Canadian residency cleanly under departure-tax rules; if she is still a Canadian resident under Article IV, the situation is different).

If she had failed to file Form 8938: USD 10,000 per failure. If she had failed to file Form 3520 for the TFSA: USD 10,000 per missed transaction or 5% of the trust's gross assets, whichever is greater. The TFSA penalty alone could exceed USD 4,000 per year; failing to catch up via the IRS Streamlined Filing Compliance Procedures could compound several years of exposure.

Section 07Section 7. Canada-US comparison: what each side reports about the other

The two countries have built reciprocal but asymmetric reporting regimes. The asymmetry matters because a Canadian becoming a US person doesn't merely add 8938 to their filing pile; they swap into a regime that reports differently, on different thresholds, in a different currency.

A Canadian moving to Florida should expect that the US regime is more aggressive on financial reporting (lower threshold, higher penalty per failure) but more permissive on real estate (Florida condo not on 8938; Canadian condo held by a US person who returned to Canada also not on 8938).

Section 08Section 8. The TFSA, RESP, FHSA trap

The single most damaging FATCA trap for Canadians is the IRS treatment of TFSA, RESP, FHSA, and RDSP as foreign grantor trusts. The Canada-US treaty does NOT extend tax deferral to these accounts the way it does to RRSP and RRIF. The consequences:

Income earned inside the TFSA (interest, dividends, capital gains realized within the account) is currently taxable on the US person's 1040, at ordinary or capital-gains rates depending on character. The "tax-free" label is a Canadian-only label; the IRS sees a regular taxable account.

Form 3520 is required annually to report transactions with the trust (contributions, distributions). Penalty USD 10,000 per missing form.

Form 3520-A is required annually as the information return of the trust itself. Because no Canadian financial institution will file Form 3520-A on behalf of the US person, the US person must file a substitute Form 3520-A with their own 1040 (deadline: March 15, two months earlier than the 1040). Penalty: greater of USD 10,000 or 5% of the trust's gross assets.

Form 8938 reports the trust as a specified foreign asset.

In practice, most cross-border CPAs advise Canadians moving to Florida permanently to close the TFSA, RESP, FHSA before they become US persons, accept the loss of the Canadian shelter, and avoid the multi-form annual compliance burden. The economic value of keeping a TFSA open while paying US tax on its growth and filing three additional forms each year is rarely positive.

The RRSP is in a different position. Treaty Article XVIII grants automatic deferral of US tax on undistributed RRSP income for US persons (this used to require an annual Form 8891 election, but the IRS eliminated that requirement in 2014 with Rev. Proc. 2014-55). Form 8938 reporting still applies, but no current-year US tax on growth.

Section 09Section 9. Common mistakes Canadians make on Form 8938

Treating the threshold as a cumulative inflow rather than an account-balance test. The threshold is the AGGREGATE VALUE of accounts at year end OR the maximum value at any point during the year. A USD 80,000 RRSP at year end crosses the single-resident threshold by itself, even if no contributions were made.

Confusing 8938 with FBAR. They are two different forms filed with two different agencies under two different statutes. Most US persons with foreign accounts file both. Filing only FBAR does not satisfy 8938; filing only 8938 does not satisfy FBAR.

Excluding RRSPs because "the treaty defers US tax." The treaty defers US INCOME tax on undistributed growth. It does not exempt the RRSP from FATCA reporting. The asset value still goes on 8938.

Excluding TFSA because "it's tax-free in Canada." The IRS does not recognize TFSA tax-free status. Income is currently taxable, and the account triggers Forms 3520 plus 3520-A in addition to 8938.

Reporting accounts at a US branch of a Canadian bank as foreign. RBC Bank US and BMO Harris are US banks under FATCA. Their accounts are US accounts. They go on 1040 line items, not on 8938.

Reporting joint accounts at half value. The full account value goes on the US-person spouse's 8938, even if the other half is owned by a non-US-person spouse.

Forgetting that a green card holder who lives in Canada is still a US person. The green card creates US-person status until formally surrendered on Form I-407 or revoked by USCIS. Living in Canada does not break US-person status; it only changes the threshold to the higher abroad tier.

Filing Form 8938 the first US-resident year but assuming it is one-time. The form is annual. Every tax year, the threshold test is re-applied; every year over the threshold requires a new 8938.

Late-filing or non-filing without consulting an attorney first. The IRS Streamlined Filing Compliance Procedures (Streamlined Foreign Offshore for non-residents, Streamlined Domestic Offshore for residents) allow late filing of up to six years of FBAR and three years of 1040 plus 8938 with reduced penalties (zero for foreign streamlined, 5% miscellaneous penalty for domestic streamlined). Filing late through normal channels exposes the taxpayer to the full penalty schedule.

Section 10Section 10. Action checklist for a Canadian becoming a US person

1. Identify the trigger date: green card issuance date, first day of US tax residency under SPT, or formal arrival on a treaty-based long-stay visa.
2. Compile a snapshot of all Canadian financial accounts as of December 31 of the trigger year, with maximum balance during the year.
3. Categorize each account: deposit, custodial, pension, trust (TFSA/RESP/FHSA/RDSP), insurance contract, direct corporate or partnership interest.
4. Convert balances to USD at the year-end Treasury rate published by the US Department of the Treasury.
5. Determine the applicable Form 8938 threshold (single vs joint, US vs abroad tax home).
6. Engage a cross-border CPA who actually files 8938 and 3520 routinely. Avoid generalists.
7. File Form 8938 with the first 1040 (or dual-status 1040 in the year of arrival).
8. File Form 3520 by April 15 (with extension) and Form 3520-A by March 15 for each TFSA, RESP, FHSA, RDSP.
9. File FBAR (FinCEN 114) electronically by April 15 (auto-extension to October 15).
10. Consider closing TFSA, RESP, FHSA, RDSP before the trigger year if the move is permanent and the long-term US compliance burden outweighs the Canadian shelter value.
11. Document the value of every Canadian asset on the day of the trigger event (this becomes the deemed acquisition cost basis for future US capital-gains calculations on departures from RRSP, sales of Canadian-held US securities).
12. Set a recurring annual reminder to re-test the threshold and re-file the form each year until US-person status ends.

Section 11Section 11. What this guide does not cover

This guide does not cover:

The Canadian departure tax (deemed disposition under ITA Section 128.1) which fires when a Canadian severs Canadian tax residency. That is a separate Canadian-side analysis, distinct from US Form 8938.

PFIC reporting on Form 8621. Most Canadian mutual funds and ETFs held outside US accounts are PFICs. The reporting and tax treatment is complex and warrants its own article.

Form 5471 reporting for Canadians who own a Canadian Holdco or Opco above the 10% control threshold.

Form 8865 reporting for Canadians who hold partnership interests in Canadian limited partnerships above the relevant threshold.

The expatriation regime under IRC Section 877A for green card holders who surrender their green card after holding it for at least 8 of the last 15 years, or for US citizens who renounce.

Section 12Section 12. FAQ

Do I file Form 8938 if I am a Canadian snowbird with no green card who properly files Form 8840? No. Form 8938 applies only to US persons. A Canadian who breaks SPT through Closer Connection (or treaty tie-breaker) is not a US person and does not file 8938.

Does a Canadian green-card holder who lives in Quebec file Form 8938? Yes. The green card creates US-person status until formally surrendered. The applicable threshold is the higher abroad tier (USD 200,000 single / USD 400,000 joint).

Is the RRSP reportable on Form 8938? Yes, even though Treaty Article XVIII defers US income tax on its growth. The asset value goes on 8938.

Is the TFSA reportable on Form 8938? Yes, AND Form 3520 plus Form 3520-A also apply because the IRS treats it as a foreign grantor trust.

My RBC Bank US account is held with RBC, a Canadian bank. Is it foreign? No. RBC Bank US is a US-incorporated bank with US branches. The account is a US account. It does not go on 8938.

Do I file Form 8938 if I cross the threshold mid-year but transfer the funds to a US account before December 31? Yes. The "any time during the year" trigger applies even if the year-end balance is below threshold.

Can I file Form 8938 separately from my 1040? No. Form 8938 attaches to and is filed with Form 1040. Filing separately is invalid.

What if I missed Form 8938 for several past years? Consult a cross-border tax attorney. The IRS Streamlined Filing Compliance Procedures (Streamlined Foreign Offshore for non-residents, Streamlined Domestic Offshore for residents) may allow late filing with reduced penalties. Filing through normal amended-return channels exposes you to the full penalty schedule.

Does Form 8938 create a tax liability? Not directly. It is informational. But the income generated by the reported assets (interest, dividends, capital gains) must be reported on the 1040 and is subject to US tax (with foreign tax credit relief for Canadian tax already paid).

How does the FATCA intergovernmental agreement affect me as a Canadian? Canadian financial institutions report US-person account holders to the CRA, which forwards the data to the IRS. This means the IRS already knows about the largest Canadian accounts of every US-person Canadian, even if the taxpayer does not file. Voluntary disclosure (Streamlined) is materially safer than waiting for IRS notice.